Beach Haven Co. purchases 30% of the stock of Ship Bottom, Inc.on January 1.2021. The book values of Ship Bottom's net assets are equal to tair value, except for the following assets, which have differences: Asset Inventory Equipment Land Customer Lists Book Value 80.000 22.000 250,000 Fair Value 83.000 12.000 290,000 15.000 Remaining Useful Life 100% sold during 2021 4 years 10 years At December 31.2022 (second year after purchasel. Beach Haven will make an adjustment on its books under the equity method, to record the amortization of fair value/book value differences That entry will include a O credit to Investment in Ship Bottom for $300. debit to Income from Ship Bottom for $600. credit to Investment in Ship Bottom for S600. credit to Income from Ship Bottom for $300. O000

Beach Haven Co. purchases 30% of the stock of Ship Bottom, Inc.on January 1.2021. The book values of Ship Bottom's net assets are equal to tair value, except for the following assets, which have differences: Asset Inventory Equipment Land Customer Lists Book Value 80.000 22.000 250,000 Fair Value 83.000 12.000 290,000 15.000 Remaining Useful Life 100% sold during 2021 4 years 10 years At December 31.2022 (second year after purchasel. Beach Haven will make an adjustment on its books under the equity method, to record the amortization of fair value/book value differences That entry will include a O credit to Investment in Ship Bottom for $300. debit to Income from Ship Bottom for $600. credit to Investment in Ship Bottom for S600. credit to Income from Ship Bottom for $300. O000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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